European equity markets are under pressure this morning, with the German index down almost 2 per cent on the day – Market Stock Analysis Today: European markets under pressure as Covid-19 cases rise.
It is becoming difficult for investors to keep a cool head. The number of new COVID-19 cases continue to rise rapidly, and an increasing number of European countries are moving towards another nationwide lockdown.
Europe is now facing a double-dip recession and lasting damage to consumer confidence.
Whether there will be another major sell-off or a continuation of the stock market rally will likely depend on how quickly governments and central banks will react to the latest developments in the COVID-19 pandemic.
However, the EU is facing another significant challenge – solidarity and imminent actions will be required again to bridge the long and harsh winter that is ahead.
In the new trading week, the central banks and earnings season will be the main focus of investors.
In addition to the European Central Bank (ECB), the Bank of Japan and the Bank of Canada will also decide on interest rates. There will be no surprises in Frankfurt.
However, ECB President Lagarde will likely acknowledge the risks and uncertainties caused by the pandemic and pave the way for further easing measures in December.
The earnings season is picking up momentum. In the US, the five largest technology giants – Amazon, Apple, Facebook, Microsoft and Google parent Alphabet – will present their latest quarterly report.
There will plenty of catalysts that could move the markets, and investors should buckle up for a continuation of the stock market roller coaster ride.
Market Stock Analysis Today: European markets under pressure as Covid-19 cases rise